Housing Market Forecasts for the Second Half of the Year

by Kealan O'Neil

Housing Market Forecasts for the Second Half of the Year




From fluctuating mortgage rates to increasing home prices, the housing market has many people uncertain about what’s ahead—and if it’s a good time to make a move. For reliable insight, the best place to turn is the experts.

Top housing professionals are beginning to share their outlooks for the rest of the year. Their predictions offer some clarity—and perhaps more encouragement than expected. As Business Insider explains:

“As mortgage rates go down this year, affordability may improve slightly for homebuyers. Inventory is also expected to grow, which should help moderate price growth and make finding a home easier.”

Here’s a closer look:

1. Mortgage Rates Should Come Down (Slightly)

Although rates aren’t expected to drop significantly, experts are anticipating a mild decline in the months ahead as economic conditions stabilize. Current data shows where rates are likely headed by the end of the year (see graph below):

a graph of interest rate

Even a small decrease in rates can make a noticeable difference. This slight dip can help reduce your future mortgage payments, giving you more flexibility in your budget.

However, keep in mind that factors like inflation, employment, and broader economic trends will influence where rates go from here. So, avoid trying to time the market, and expect some fluctuations along the way.

2. Inventory Will Continue To Grow

Inventory has already seen significant improvement this year. Much of this growth is due to homeowners getting tired of waiting to see what happens with rates. The wait-and-see approach hasn’t paid off for many, and eventually, people need to move regardless of market conditions. This shift has led to an increase in listings, and experts predict this trend will continue. Lance Lambert, Co-founder of ResiClub, explains:

“The fact that inventory is rising year-over-year . . . strongly suggests that national active housing inventory for sale is likely to end the year higher.”

If rate predictions hold true, this could motivate more sellers to enter the market, providing you with even more options for your next move.

3. Home Prices Are Moderating

As more homes become available, the upward pressure on prices will ease. Experts still expect some price growth, but the rate of increase is slowing as inventory continues to rise. On average, forecasts suggest a 2% increase in home prices this year (see graph below):

a graph of growth in green squares

This could mean some relief from the fast-rising home prices. When you factor in the expected moderate price growth alongside projections for slightly lower mortgage rates, you could have more buying power in the coming months.

However, remember that the housing market is highly localized. This means conditions will vary by area. Some markets may see prices continue to rise, while others could experience a slight drop if inventory increases significantly. It’s best to consult a local agent to get a better understanding of your specific market.

Bottom Line

If you’re planning to move this year, experts suggest things will likely improve. Let’s connect so you can make the most of any market changes that benefit you.

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Kealan O'Neil

Broker | License ID: 471.018734

+1(630) 788-7273

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